Hi Everyone! Welcome to my end of January 2016 net worth update. Thank you so much for coming.

My opening statements of my net worth updates for last entire year was “Wow this month was another crazy month” and unfortunately or fortunately 🙂 for some people, I will have to repeat that again.

“January 2016 was probably one of the most volatile months in a while.”

The Canadian market dropped by about 10% until January 20 then it recovered back to -3% from where it started. What an exciting time right?

People who picked up stocks in January 20 saw most of their stocks in green and probably up 7-13% by the end of January. While I saw market dropping by another 3- 5% from the timing of writing this, I know for sure it will eventually climb back up and exceeding where it is today.

Wait until rainstorm stops and sun rises which always does.

It is only a matter of time until you see more greens in all of the stocks in your portfolio if you are a long term investor. Just keep being invested in your quality stocks. If you are a lucky one who gets regular paycheque and have some money to invest after your monthly spending, then this is your time. Keep buying at lower prices every month. Keep it simple. Don’t think too hard. Just find good quality undervalued dividend stocks, buy them at low and weather the rainstorm until sun rises again. When the sun rises which it always do, it will be swift.

Ironically, people get more excited when market climbs up when they have to pay premium for the same stocks whereas when the market is headed downward, they tend to avoid buying the same stocks at discounted prices. I would worry more and look to restructure my portfolio when the market keeps climbing up. Time for me to say my favorite investor of all time, our legendary old man, Warren’s most famous quote.

“You want to be greedy when others are fearful. You want to be fearful when others are greedy. It’s that simple.”

Remember 2008-2009 market crisis?

2008-2009 market turmoil made so many people richer and poorer. People who became poorer are the ones that sold their stocks at loss and never looked back. People who became richer are the ones that bought stocks at 30-80% off the original prices then they triple and quadruple their original investment within 2-3 years.

This turmoil in Canada isn’t as opportunistic (or bad) as 2008-2009 market crisis but still a good time to buy low. There are so many undervalued stocks. That simple concept will make us richer sooner or later. I have no way of knowing and an ability of forecasting the market but all my efforts will be dedicated to find undervalued stocks.

Guess what? My net worth increased by $1,589 (1.1%) from $141,170 to $142,759 during January 2016.

This is my first 2016 net worth update. Net worth update is posted monthly to keep track of the progress of my journey to become a millionaire. I believe anyone can be a millionaire with good saving habits and smart investing plans. If you would like to join the journey, please follow me through my Facebook and twitter pages and subscribe your email for free updates.

Compared to January last year, it grew by $38,532. That’s 37% of growth. It grew by $3,211 every month. Not bad huh? I am quite pleased with the result but it could have been better. Well… the downturn of the economy will eventually turn up and I will be a very happy man when that happens. Until then, I will keep buying undervalued stocks and see where this takes me. If you are afraid of losing 20-30% of your portfolio value then investing in stock market isn’t for you. Risk and rewards always follows. Always perform your due diligence researching the fundamental of the stocks before you buy or just buy amazingly reasonable Vanguard ETFs. That’s called indexing.

Barely maintained $140K level this month.

Cash

The cash balance has decreased from $10,435 to $8,189. I have moved about $8,000 to my and my wife’s TFSA accounts and purchased Dream office REIT and Orvana Group and have been reserving cash until I find a better timing. Even after reduced annual TFSA contribution limit from $10,000 to $5,500 from a stupid political move by the new regime in Ottawa, TFSA is still an amazing instrument to invest so for someone who do not take advantage of TFSA and RRSP (for US citizens, 401K, IRA, ROTH IRA…) please use them for your future. They are wonderful instruments that will make your future brighter.

My majority of cash is sitting in President choice Debit account. I use it for the most of the money transfer, bill payments, cheques etc… as there is no transaction fee in this amazing card and cheques are free. Major banks typically charge $50-100 for 50 cheques but I pay nothing for that. Due to its partnership with CIBC bank, I can use their extensive CIBC ATMs network which is awesome. Their customer service is great as well.

I use TD bank card as well which is mainly used for investment fund transfer purpose as it is connected to TD warehouse brokerage account which gives me some convenience of transferring fund and invest.

Investment

January was another crazy month. My investments have decreased about $3,000 which is about 2%. Well. That’s alright. I am not selling them anyways and I would love for better opportunities to pick up more shares at even more favorable prices. Tides will eventually turn. Buy low and sell high right?

As long as fundamentals are there, I am not too concerned about the noises. Although it hurts to see my portfolio decreasing its value but I have a coping mechanism built in me which is hiding somewhere where no one can see me and do a man-cry. Haha. Hey don’t judge me. Whatever works. 🙂 Only problem I have right now is how to come up with more cash to take advantage of discounts in the market. 🙂 I am reserving cash to get ready for RRSP (For US Citizens, 401K, IRA, ROTH IRA…).

If you recall my November net worth update, I kinda hoped that the market stays like this or even drop further temporarily so that when January 1 2016 hits, I can afford to buy more stocks at good discounts, I pulled my triggers already as I said previously. See below for what I bought.

When you invest, you should always look at long term investing horizon, not tomorrow, next month, next year etc…. If you foresee that you would need cash in a near future then investing in stocks isn’t for you. However when you start to focus on longer term view, then you will do quite well as long as you buy good stocks with great fundamentals at attractive price.

If you are also a dividend investor like me, then you should check out the following page to see how other dividend investors are doing. You won’t regret a moment of reading their valuable and inspirational articles. Blogroll

Credit card

My credit card debt soared from $669 to $2,547. What the heck happened?? BeSmartRich having $2,500 of credit card debt? Unbelievable. Right? Well… My wife and I found one of the most lucrative investments that pays you guaranteed returns- Education.

My wife is back to school. I don’t know whether you will remember this but my wife is a mad artist (I will show you some of her artworks later if she allows) and have spent several years to do her soul searching. Well guess what? She wants to be a nurse in Canada then combine her artistic talents with the nursing degree to be an art therapist eventually. She is from South Korea and recently immigrated to Canada. I have emphasized this to you before, if you are a foreign immigrant, getting right education is one of the most important things that you will have to do to be treated equally (not to mention your language skills but you will pick up while you go through your degree programs) and self-sustaining. Let me tell you, it is not going to be easy. I have been through it but very well worth it.

Well yes, you can get a job without educations from where you immigrated but you will find hard time finding your career. Job and career are two different things just as Chris Rock says.

While I love to see my wife showing off her artworks and helping me out with this blog (She designed this BeSmartRich blog. She also helps me with maintenance, research, promotion, advertising etc…), I am extremely pleased with her decision to going for her dream which is a great cause for the community we reside in.

I see it impacting our net worth as one step back and ten steps forward. We may be spending $2-3K per semester which will temporarily and negatively impacting our net worth but that will give back hundred times guaranteed returns during our lifetime. That’s the power of education. Only sky is the limit. Not to mention we can recoup some tuition costs through tax credits, courtesy of Canadian Government. Thank you Canada. I love you so much!

Canada, the land of immigrants’ dream!

I am still close to debt free and I like it that way. I just love the feeling of keeping my debt balance low as I feel empowered to be debt free.

We tried to minimize spending over last couple of months and it worked out pretty well. We use Capital one Costco credit card as it gives us 3% cash back on restaurants (6% on first 3 months). We also have MBNA cash back card that we use mainly for grocery and gas for 2% cash back and everything else for 1% cash back (5% on first 6 months) without any annual fee. Unlike capital one cash back card and all other cash back cards out there, MBNA card is well beyond expectation. First of all, MBNA pays cold hard cash back (not points toward purchasing goods and services) and secondly, MBNA directly deposits the cash right away to your bank when it hits $50 mark. That’s great as I don’t have to wait until the end of the year to collect cash. Remember. Everything adds up.

Check out the following links if you are interested in getting awesome credit cards like MBNA and Capital one credit cards.

Spending

We have been tightening up spending. We set up two major rules and following religiously so far.

My wife added some more healthy option after watching some documentary films about how chickens, milk cows etc… are raised so we have been purchasing quality organic ingredients, cook home meals most of time and go out and enjoy restaurant meal once a month together in a mutually agreed restaurant.

We shop at Costco once a month for majority of grocery (They are always fresh and love their AAA beef so much for very attractive prices) then for urgent needs, my wife goes grocery nearby our place for eggs, milks, vegetable and fruits as in need basis. Our monthly grocery budget is $500 per month. I know it is high for just two people but we love healthy and good quality food and I am a meateatarian.

We will keep being frugal on all other expenditures. See the following links for excellent ways to save money.

Hope you enjoyed this month’s net worth update. Remember, if you haven’t, set your saving & investing plans up and try to see how much net worth you have reached as of now and how much it has fluctuated in the past. Knowing where you are and where you will be headed will be a great starting point to be a millionaire and retire comfortably. Hang in there. I will be on the journey with you.

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Thanks for sharing BSR. You’re doing great and I’m glad we are both travelling on this wonderful path. Keep up the great work and enjoy the journey. I wish you continued Success; Happiness and Health! Cheers bud.

You are very right. The entire market is on sale and I am seriously thinking about dipping my toes again even after promising myself that I want to reserve cash. I gotta be patient 🙂 Thanks for stopping by EL.

No market darling is safe in this bear market - $PBH $NFI $RCH $BYD $DOL $SPIN $KXS $CCL etc.
Many of them are in 1.5- 2 years low. Great time to initiate or build up. Discount is still discount. We just don’t know how heavy the discount will be and how long the sale will last

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